Million Pound Whisky

July 22nd, 2013

Gavin Smith reports on the new “Paterson Collection;” a dozen unique bottles of The Dalmore for an asking price of £987,500.

It had to come at some point: the “million pound whisky.” And here it is. To be fair, The Paterson Collection of a dozen unique bottles of The Dalmore is actually on sale for £987,500, rather than a straight million pounds. However, that’s just because top London retailer Harrods decided it didn’t want this collaboration to be all about price, and instead hoped that people would focus on the rarity of the actual product and the sheer excellence of its presentation.

Nice idea, but it seems unlikely many headlines will be generated that don’t include the phrase “million pound whisky.”

This venture by The Dalmore’s parent company Whyte & Mackay, is the work of master blender Richard Paterson, and may be seen as the culmination of The Dalmore’s campaign to offer ultra-exclusive expressions, as exemplified in last year’s 21-bottle Constellation Collection, the first of which sold for £158,000.

The Paterson Collection is certain to increase the entrenchment between whisky drinkers and whisky collectors. It will undoubtedly attract criticism in some quarters along the lines that the whole project is divorced from the reality of the mainstream marketplace, and is effectively the equivalent of a motor manufacturer unveiling a futuristic concept car to gain publicity and a halo effect for its more down-to-earth offerings aimed at mere mortals.

Nonetheless, Harrods is confident its one-off Paterson Collection will sell and sell soon, though whether the purchaser sits down with a group of friends to drink their way through the twelve bottles remains to be seen. Richard Paterson is a passionate advocate of the view that whisky, especially very old and rare whisky, is there to be drunk, not form part of a hedge fund portfolio, but this collection seems destined to remain unopened, due to its value and unique nature.

So just what is the potential buyer getting for his or her money, and what will he or she be missing out on by not drinking it?

In order to create the collection, Paterson has plundered the darkest corners of Dalmore’s warehouses. The oldest whisky to be included in the series dates from 1926, while the youngest was distilled in 1995. Each decade from the 1920s to the 1990s is represented within the Collection, and every expression is named after one of Paterson’s Scotch whisky heroes. These are not single cask bottlings, however, but “assemblages” from several casks, which in many cases have then undergone secondary maturation in different types of cask prior to bottling.

According to Paterson, “I personally have invested a huge amount of time ensuring that each of these twelve expressions represent the very best of the incredibly rare and valuable stocks that we nurture up at the distillery in Alness.”

Glencairn Crystal has designed lead crystal decanters for the collection, which is housed in a wooden cabinet made by Gavin Robertson. Paterson himself has spent an estimated 1,000 hours or more crafting the contents of an 800-page handwritten, calfskin “ledger,” detailing aspects of Dalmore’s heritage, his own career, characteristically flamboyant tasting notes for the whiskies, and the story of how The Paterson Collection came into being.

The excellence of the whiskies themselves is not in doubt, and neither is the lavish yet discreet manner of their presentation. But can they really be worth £1 million? If someone buys them, then the answer presumably is yes!

I agree with the above; with a price tag for the collection that almost makes Trinitas plausibly sippable by comparison, this has all the makings of the ultimate confidence game (which all such vastly overpriced whiskies are anyway, and which the magazine could simply acknowledge in a demonstration of basic field competence, if it felt need to comment at all, instead of making the silly Dalmore-serving argument that, if someone buys them, the collection is presumably worth the money – urban legend says many people bought the Brooklyn Bridge, too, but that didn’t make them experts on engineering values or even wise investors). Fools and their money are soon parted, and that isn’t affected by scale. In order to make any meaningful comment on worth, Gavin would have to tell me, if he had the money, that HE would buy and drink the collection.

There’s really no evidence that there’s anything more than coloured water in those particular bottles (and very unlikely to be any), much less, given that it’s Dalmore, that there’s any guarantee of uniformly brilliant, rather than uniformly competent, whisky (something Gavin knows himself, with his 89/100 review of The Dalmore 1973 aged 38 years, 48.1% Price: $17,600.00), much less any guarantee of uniformly brilliant whisky somehow worth £82,291.67 per bottle).

Mr. Paterson’s purist showmanship in saying whisky, especially very old and rare whisky, is there to be drunk, reminds me instantly of his showmanship in talking about throwing out a glass of whisky after being given ice in it – after, for the purposes of the demonstration, filling the glass with ice himself from a Whyte & Mackay ice bucket. He might have a very good nose, but to take what he says at face value is best reserved for the whisky novice (or the whisky writer?), because it’s as much theatre as anything else. You simply don’t make these overpriced whisky trophy/doorstops if you want the whisky actually consumed, and it begs the question how much Mr. Paterson has ever personally spent on a bottle that he opened (and was it a Dalmore?).

And yet, for all the hoopla, even the people spinning this couldn’t get it right: even by the vastly bloated ideas of price being thrown around here, there isn’t, by ANYONE’S count, a “million pounds of whisky” here. And since, evidently, we’re ALL agreed on that, the only real issue is how much less than a million pounds the collection represents. Any bids?

This is simply luxury item being sold as such to a very small market of ultra-wealthy collectors. It will be a statement piece for one of them, a trophy if you will.

What is the value of the collection? Whatever someone will pay. No different than a baseball card, comic
book or artwork.

The fact that we consume whisky is where all the fuss is. Is this made for drinking? The whisky was.
It may not be drinkable now as part of THIS collection. That will be determined by the buyer if they find one.

As for me, I don’t care for Dalmore in general and it makes me much less likely to revisit it due to my distaste for this type of sales pitch. However, a small market exists for such products and I can’t fault people for trying to access that market segment. I can simply voice my displeasure & ignore their products as I see fit for myself.

I went to look at this (on my own time, not the W&M PR jolly) and it is a handsome piece of furniture. As for value, well the UK taxman will take the usual excise duty and around £165,000 in sales tax. Then there is Harrods’ margin – unlikely to be less than 30-35%. Then the cost of the cabinet, decanter and all the other paraphenalia that makes up the theatre of these things.

You can see where this is going – it rather calls into question what you’re actually paying for the whisky. Which, before anyone reminds me, is not actually the point – I do realise that.

The last few years have seen a marketing masterclass from Dalmore in which they have taken The Macallan’s luxury brand playbook and beaten them at their own game. All this from a whisky which historically never had that much of a reputation. Back in 1989 the late Michael Jackson was scoring it 79 when rating the equivalent Macallan 91. So kudos to Damore for their commercial savvy, though I can’t imagine it continuing for very much longer if Diageo take control.

But where is it going to stop? Is this, as Gavin suggests, really the “culmination” or will they not come back for more? How much of this 1926 distillation remains, and how long ago was it put into glass? Sadly, I’d suggest that the person who buys this collection won’t have the faintest idea why I ask that question or why it matters. Which may tell us all we need to know about the buyer!

As readers of this blog will know, I have two main concerns with this type of thing: first, it leads to an inexorable inflation in whisky pricing as other brands see this and try to get in on the action and all prices start spiralling upwards – hard to deny that that hasn’t happened – and second, that it feeds the “whisky as investment” bubble that is currently rushing headlong upwards but will, IMHO, end in an inevitable and painful crash. If only I knew when…

As John Hansell asked here recently “Why are you buying whisky?”
Just drink it, for God’s sake.

If Dalmore is to be given kudos for their commercial savvy and success, then kudos are also deserved for the ability of Dalmore and other producers to successfully enlist the majority of the whisky media in their ongoing confidence games – and they have been very successful on that score as, regardless of the silly marketing and trappings, and ever-increasing price tags, no one will simply state the obvious in clear terms and say these prestige bottlings are OUTRAGEOUSLY overpriced (Ian has dropped some hints in this direction, but the time for hints may now be over). Has the industry finally “jumped the shark” or, as usual, is it still perpetually on the brink of doing so?

There is no way that whisky or worth even 1/100th that price. As long as there are nouveau riche (and there always will be) who have no idea how to spend their money, there will be rediculous prices for stuff. $5000 bottles of wine, ?1M whisky, and $750 black truffle Kobe burgers will always exist.

“The last few years have seen a marketing masterclass from Dalmore in which they have taken The Macallan’s luxury brand playbook and beaten them at their own game.”

Really, how? While the “Rolls Royce of Single Malt Whisky” continues to rest comfortably on the reputation and laurels from its now distant past, the poor PR suits Whyte & Mackay have to resort to these kinds of cheap parlour tricks just to get the their brand mentioned anywhere off the wire.

I did indeed get to sample several of the whiskies that comprise the Collection as it was being assembled. These were quick and informal tastings, but the older expressions I tried had great depth and complexity associated with their lengthy maturation period, while retaiining a freshness and vibrancy. Very high scorers in the Buying Guide, were they to be featured there!

thanks for the clarification, gavin. though i’m still not entirely sure if you got to taste several of the final twelve expressions or several of the whiskies that went into the “assemblages”.

as for the concerns some others have expressed, i’m not sure that million pound/dollar gimmicks really have much of an effect on our (larger) end of the market. to make an imperfect analogy, places in las vegas (this part of the analogy is not imperfect: dalmore is las vegas) selling $10,000 burgers may or may not have had anything to do with the uptick in haute restaurants selling premium burgers at premium prices, but neither development has had any effect on the makeup or price of burgers at diners etc. (to say nothing of mcdonald’s).

i think the bigger issue for us is other kinds of gimmicks that test the limits of what people who actually buy whisky regularly are willing to pay. in this category i’d place things like the shackleton zombie whisky, lvmh’s experiments at ardbeg and especially glenmorangie etc..

Jeff, this has nothing to do with value, so that’s not really a fair question. If I went through my entire life only buying things that were a good value, my life would be a lot more boring. This blog would not exist. Neither would Whisky Advocate or WhiskyFest.

Over the years, I’ve purchased whiskies that I knew were not good values. But I knew they were great whiskies. Every once in a while I would purchase one for a special occasion, and I have no regrets doing so.

The most I ever spent on a whisky was $300, for a bottle of the first release of Black Bowmore back in the 1990s. Was it a good value? Not at the time, because it was one of the most expensive whiskies on the market. However, it was one of the best whiskies I’ve ever tasted and I cherished every sip. With friends.

I’m not saying readers here should blow all their money on expensive whiskies, but I am trying to add perspective to the situation.

It’s a perfectly fair question, John, and Gavin is uniquely qualified to answer it. It’s interesting that you are trying to save him the bother of doing so, but what this REALLY has nothing to do with is your personal buying habits or reflections upon them; you didn’t sample the whisky in question. If you do want a question to answer, here’s one you didn’t get to earlier: Has the industry finally “jumped the shark” or, as usual, is it still perpetually on the brink of doing so?

The only way value doesn’t apply here in terms of quality vs. price is if the quality is irrelevant on the basis of the idea that the bottles will never be opened, in which case Whisky Advocate has no more reason to deal with the collection at all than it does a sealed can of peas. Otherwise, value is at the very heart of the issue here, and quite possibly, and logically, a central concern for any potential buyer of a collection with a £987,500 price tag. As you note with your buying of the Black Bowmore, whiskies can be bad values, and that’s all I want to resolve in this case.

Is it Gavin’s opinion that, at this price, this collection is a good value as drinkable whisky or not?

I agree with John that this has nothing to do with value. Is a Bentley a good value as a means of transportation? Is a Rolex a good value as a serviceable timepiece? The pricing of luxury goods bears little relationship to intrinsic value. Quality of materials and workmanship alone do not make these items “worth” the asking price. Those who could afford the Paterson Collection would likely view the quality of the whisky to be a secondary consideration. It is simply another way for someone with more money than sense to make a statement.

That being said, should Car and Driver or Road and Track stop covering Bentleys because only a handful of their readers could afford to purchase one? Regardless of one’s opinion of the Paterson collection and its ilk, it a legitimate part of the current whisky landscape, and, as such, it is fair game for inclusion in Whisky Advocate and other whisky news sources. As outrageous as I find it, it fascinates me to follow the pricing of these whiskies. I’m not sure that I buy into the idea that the publicity garnered by these whiskies automatically lets standard-range stablemates ride their coattails to higher pricing. These outrageously priced whiskies are not representative of the industry, they lie on its fringes, so I don’t believe they are indicative of whether the industry has jumped the shark.

Anything “not worth” the asking price is, by definition, overpriced. Is that the case here, because it’s what I want to know, the price is astronomical, no one’s on the record and Gavin has an expert opinion on the quality of the product in question.

As for the Paterson collection and its ilk being “a legitimate part of the current whisky landscape”, I find that far from proven – by anyone. Almost everyone agrees that the chances of anyone actually opening this stuff are negligible and John has said that the value of the collection as whisky is immaterial, so where is the relevance and legitimacy?

Similarly, if you’re right and those who could afford the Paterson Collection would likely view the quality of the whisky to be a secondary consideration while they try to make a statement, it’s really not about the whisky at all then, is it? So again, where is the relevance and legitimacy? Your points, and John’s, all play into the completely false, and illogical, argument that the Paterson Collection can somehow be important TO whisky without being important AS whisky. If that were true, you could equally argue that your Bentley and Rolex should be covered by Whisky Advocate as well.

As for the question of “jumping the shark”, it was never framed as one of industry pricing in general – it refers to John’s blog “Ridiculously expensive whiskies have just about jumped the shark” (September 21st, 2012), specifically concerning these kinds of bottles.

I’m still waiting on a response from Gavin. Is this collection, at this price, a good value as drinkable whisky or not? Why is there no answer?

Because your argumentative tone and attempt to call Gavin out makes him want to disengage with you, not engage. No matter what answer he gives you, you’re going to just post another reply about why he’s wrong.

Seth is right, Jeff. You really need to start toning it down. Not just with this thread, but with how you engage this blog in general. All your comments are like this, and It’s becoming counterproductive, discouraging people from commenting.

Please make your point and move on, without becoming endlessly argumentative. Fair warning…

You could be right in what you’re saying, Seth. It could also be that Gavin says nothing because he finds himself without a satisfactory answer to the question: if he says the Paterson Collection is not a good value as drinkable whisky, he discredits Dalmore and, by extension, all makers of these products; if, at a cost of £117.56/ml (or about $180.86/ml USD, and assuming 700 ml bottles), he says that the collection is a good value as drinkable whisky, he discredits himself as a whisky professional.

come now: the barrier for something not being a good value for drinking whisky is quite a lot lower than a million dollars or whatever. i’d argue that number is closer to $300. gavin has said that the whisky that he has tasted of/from this collection is of a high quality (though i’m still not clear if he tasted the finished vattings, how many and which ones). no one, not even the oligarchs who can afford to buy this, thinks the whisky as whisky is worth that price. the commodity that’s being sold here is the price not the whisky. anyone who would buy this is not interested in the whisky but in signaling their ability to buy it.

i do agree with you (and steffen) that whisky advocate might consider how much attention it gives to these marketing sideshows, whether on the blog or in the magazine.

Thanks for your reply and I think your points are fairly made, certainly in that they don’t misstate mine. I entirely agree with you that “the commodity that’s being sold here is the price not the whisky” which is why I only point out that, if that fact can, indeed, be universally acknowledged, there’s no reason for Whisky Advocate to deal with the Paterson Collection at all – because the commodity in question, as you say, isn’t whisky.

Mongo, the highest price ever charged for a set of whiskies is certainly newsworthy. It’s our job to write about newsworthy items in the world of whisky. I’m not going to selectively filter the news, based on my (or your) personal opinions and beliefs. It’s not fair to the reader. If you don’t like what you read, then express your opinion. But don’t tell me to not report the news.

john, i’m not telling you to do anything; just noting that i am a reader who finds it a little troubling. in fact, i was a subscriber who cancelled because i found the trend towards this kind of thing in whisky advocate not to my taste.

i do recognize that whisky advocate is a lifestyle/features magazine and not the place one should look to for hard analysis of the kind jeff would like. that said, i do find some aspects of gavin’s write-up troubling nonetheless. yes. the most expensive whisky/collection ever is newsworthy, but a large chunk of the write-up, almost the entire second half of the article seems like it is ripped from whyte and mackay’s marketing materials. it further blunts the rather toothless critique, if it can even be called that, of the ludicrous price/gimmick aspect in the fourth paragraph. and it’s telling that there too, the possible critique of this kind of thing is fobbed off onto abstract “whisky drinkers” and doesn’t seem to be shared by whisky advocate as well.

and as i’ve said, i still am not sure to what extent and in what part of the process gavin tasted the whiskies he says he did. it’s not that i don’t trust him, it’s that he’s not very specific even in his clarification and i think it would benefit the piece if there was more clarity on that point.

Let me begin by saying that I feel it’s our job to cover the entire whisky industry, not just the whiskies that a certain percentage of you (or even me, for that matter) can afford. This new series of whiskies is certainly noteworthy, and that’s why we are writing about it.

Ian, with all due respect to Michael, I absolutely loved some of those Stillman’s Dram bottlings (26-30 year old) more than a decade ago. I even liked the un-sherried 21 year old expression they put out back in the day. Also, I had the good fortune to taste the 50 year old Dalmore juice that went into the crystal decanter that was distilled back in the 1990s and it was one of the best whiskies I’ve ever tasted. I have great respect for Richard Paterson in his ability to produce the finest whiskies based on the parameters White & Mackay allow him to work within. (Remember, he’s the whiskymaker, not the marketing director.)

Regarding the packaging and pricing, I don’t have any problem with this. This is a business. If White & Mackay wants to dress them up and charge a lot of money for them, that’s their prerogative. If someone buys it, then they have accomplished their mission; if it doesn’t, then they have to live with that and it will be a lesson learned. This is capitalism in progress, and it doesn’t surprise me one bit. I suspect that there’s a billionaire out there somewhere who loves whisky, and that’s where this is going to end up. Who knows? He (or she) might even drink it.

Are we in a bubble? Probably. But how long will the pendulum will swing too far in one direction before reverting back to the mean? Look at tech stocks in the late 1990s, real estate in 2005, and gold a couple years ago.

I don’t like the price increases more than anyone else, but it’s something we are all going to have to live with in the interim. For the entire 1990s, whisky was undervalued. A lot. Now, the shoe is on the other foot.

I do feel a little down about the pricetag. That being said Whisk(e)y is a luxury item and prices are market prices like artwork. If the consumer does not want the item, make it known and do not purchase. I feel sad because I reminisce like you John about those fantastic Stillman’s Dram Bottlings and how they were $95-$130 a bottle. I have my doubts on whether the market will correct itself this time without crippling the Whisk(e)y industry but that is for another discussion.

Hmmm…I’ve got one of the Dalmore Stillman’s Drams hanging out in my cabinet somewhere. I think it is the 28 YO. I bought it years ago and forgot about it. I didn’t know it is so great. Time to pop that cork!

When I first met him in 1998 Dalmore didn’t even have a store or a tasting room, there was an office on the second floor of one of the distillery buildings with some nice couches and chairs where bottles of Dalmore set on a table. A few key chains and other trinkets were in a bowl free for the taking and we just set around and sampled whatever we wanted.

Derek used to say, “Nothing here is for sale at Dalmore” No doubt he would be flabbergasted at what has transpired.

If Herrod’s can sell it more power to them. The distillery industry isn’t a charity and we can bemoan what has happened but as I have said on this blog more than once, until people stop buying it and until these bottles stop appreciating there is nothing any of us can do or say to stop it.

Dalmore’s Constellation Collection and new Paterson Collection are a bold statement on where they feel the market is going. Others have and will continue to follow suit because the margins on these products are generous. Will they sell? I think time will tell. And are they contributing whisky investment bubble? Maybe, but again only time will tell. Just because some “collectible” whiskies have been over priced, doesn’t mean the whole market will crash. That said I don’t think either of these collections are good investments, because they are priced so high that it is hard to see them ever accruing in value.

I disagree though the “super premium” category is driving the inflation in general whisky pricing. I think growing demand and interest, combined with forecasts in the 1980’s/90’s which were too low are to blame for that. Simple supply and demand!

The purpose of releases like this is to catch attention. By reporting about it on your blog, you just become the extended arm of Whyte and MacKay’s marketing depatment. The purpose of this is to market 12yo Dalmore…

It sure seems that way, but as I mentioned above, bubbles (assuming we are in one) can go on for a long time before reverting back to the mean. Much longer than people expect. Bubble peaks (and Shark-jumping) only becomes evident after the fact. It’s backwards-looking. Who knows how far this current market can go? I have this feeling that there’s more of this to come (at even higher prices)

The current stock market is making new record highs almost daily, and it was the most unloved bull market in my lifetime. It sometimes seems like it can’t go any higher, but will it? Who knows? Only time will tell.

I have not purchased any dalmore since you repackaged and since you raised the price on dalmore 12yo from $27 to $45. (That’s since the year 2007, for those keeping track.) However, I have spent A LOT of money on other whisky, like aberlour, glenfarclas, glendronach, etc.

I recently encountered a packaging of dalmore 12yo with a 50cl bottle of dalmore cigar malt. Sorry, this fish isn’t taking the bait.

Wow Gavin, forgive my vernacular but that is a bloody well written article. There are too any puff pieces and whisky-geek-rage articles going around about this release. You’ve balance out the ludicrous nature of the whisky investment bubble with a solid understanding of how collectable markets value ideals like the “soul” of the product more than it’s quality.

Great way to open the debate in the comments! Think this just converted a long time lurker to finally post a comment. Big question though;

Is this Patterson’s swan song? Who’s the upcoming blender behind the old master?

J. Hansell: “I don’t like the price increases more than anyone else, but it’s something we are all going to have to live with in the interim. For the entire 1990s, whisky was undervalued. A lot. Now, the shoe is on the other foot.”

John, I know you don’t want a lot of negativity on the board, but the idea that we should look at this as some kind of “interim” period, during which we

1. Recognize the blessings of the past,
2. Suck on the bitter of today, and
3. Perhaps, look forward to better days.

This isn’t the first £1m whisky. I have a small selection of whiskies for sale for £1.5 million. It includes a bottle of Powers from the 1990s that has a stain on the label that looks like Diego Maradona and a bottle of Teachers that is very special because all the contents have evaporated.